Travel group Thomas Cook battles for survival
LONDON 22 Sep (ANA) - The British government has plans in place to bring home stranded holidaymakers if Thomas Cook (TCG.L) goes out of business, an event that would likely spark chaotic scenes at resorts and airports around the world.
The bosses of the world’s oldest travel company were meeting lenders and creditors in London on Sunday in a last-ditch attempt to raise the 200 million pounds ($ 250 million) they need to keep the company afloat.
Running hotels, resorts, airlines and cruises, Thomas Cook has 600,000 customers on holiday, meaning governments and insurance companies could be forced to step in and bring them home if the company goes into administration.
Unions and the opposition Labour party have urged the government to stump up the cash, but the foreign secretary appeared to dismiss that idea on Sunday.
“We don’t systematically step in with the taxpayers’ money when businesses are going under unless there’s a good strategic national interest,” Dominic Raab told the BBC, adding that plans were in place to prevent anyone from being stranded.
The company, founded in 1841, has been fighting for its survival after its lenders threatened to pull the plug on a rescue deal that has been months in the making.
Hurt by high levels of debt, online competition and geopolitical uncertainty, Thomas Cook needs to find another 200 million pounds on top of a 900 million pound package it had already agreed, to see it through the winter months when it needs to pay hotels for their summer services.
The company’s largest shareholder, China’s Fosun (1992.HK), was due to take a central role in the restructuring.
A person familiar with the situation told Reuters the company was spending the weekend in talks with the government and a number of potential investors about bridging the funding gap. “We have not given up,” the person said on Saturday, declining to be named due to the sensitivity of the situation.
The management team, led by Peter Fankhauser, met banks and bondholders at a London law firm on Sunday morning before a board meeting in the early evening to determine whether it can continue.(ANA)
FA/ANA/22 September 2019-----